Exports Key, Says Ford Australia

By Brendan Moore

07.14.2007

Ford Australia has been losing money in the cutthroat Australian market, and now thinks it may have a solution: exporting their big tough cars from Oz.

Ford lost A$40.3 million in 2006 after netting A$148.2 million in 2005. The casual observer might write the 2006 loss off to the cyclical nature of the car business, but Aussies are more and more voting for smaller cars with their wallets, and this is leaving Ford’s flagship, the rear-wheel-drive six-cylinder and eight-cylinder Ford Falcon somewhat adrift from a sales perspective. The trend towards smaller cars in Australia seems to have staying power and the officials at Ford have taken notice.

Ford is Australia’s No.3 auto maker, but is running below capacity at their main production facility in Melbourne, and is making noises about closing an engine plant in Geelong (outside Melbourne) that has been in operation since the early history of Ford Australia in 1926. And it should be pointed out that Ford is going down in an up market – total sales in Australia last year hit an all-time record of a little over a million units. Toyota is the sales leader in Australia with 22.2%, Holden (General Motors) is second with 14.5%, and Ford is third with 10.4%.

Ford believes that even if Australians don’t want the big RWD Falcon so much anymore, there are plenty of other people in other countries that would buy the Falcon if they could. Ford Australia has a small export going currently, but it accounts for only about 7000 units out of total Australian production of 81,500 cars. Those 7000 cars go to Thailand, New Zealand, and South Africa.

But Ford Australia thinks that Europe would like the Falcon, albeit in small numbers, they think that the Middle East would love the Falcon, particularly the Falcon XR8, the V8-powered model, and maybe most importantly, Ford Australia would love to export the RWD Falcon to the huge United States market, much like Holden is providing cars on their large rear-wheel-drive platform to General Motors in the U.S. Holden (at least initially) is providing the upcoming Pontiac G8 model to GM in the U.S., and is also the company building the new Chevrolet Camaro, which is scheduled to appear in the U.S. for the 2009 model year. Holden also builds RWD cars for GM to sell in the Chinese market and the Middle East market. Ford is casting very envious glances at the export volume Holden gets from all of those sales of their RWD platform cars.

Will it happen? Will Ford Australia be able to dramatically increase their export numbers? Well, just looking at the U.S. situation, the new CEO of Ford, Alan Mulally, is known to be an admirer of the Falcon, but Ford needs smaller cars in the U.S. more than bigger cars, and they already have the RWD platform the Mustang is based on if they want to expand their RWD offerings. Ford is looking towards their European models to solve some of their product woes in North America, not to Australia. Still, the Falcon could appeal as a niche model in the U.S. In Europe, the Falcon would definitely be only a niche model for high-performance buyers. The Middle East region is mad for high-powered cars, but the total market that can afford such cars is small. So, it doesn’t seem as if the immediate prospects for sizable export volume (and the accompanying profit) are in the cards for slumping Ford Australia, but then again, a single new U.S. model based on the Falcon RWD platform could do the trick nicely by itself, should the U.S. arm decide to go that way. If, if, if.


And now is the time to give you this pertinent bit of information: I saw a new Ford Falcon XR8 here on CA Highway 1 in California several months ago. It was RHD, with manufacturer plates, and being driven with expediency, so it was kind of hard for me to miss, since I have never seen another Australian Ford Falcon on the road here in the States. I can only assume it was being road-tested, and perhaps additionally, maybe being put in front of regular people through the mechanism of consumer clinics, in order to get their reactions.

Of course, this may still be meaningless because a decision could have been made after that visit that the Falcon wasn’t a fit for American tastes or that it wasn’t a fit for Ford of North America’s product strategy. Conversely, perhaps the opposite conclusion was reached by the Ford brass. Since I’m not privy to the conversations they’re having at Ford in Dearborn, its all guesswork at this point. From an enthusiast’s perspective, I’d love to see the Falcon here in the States. But I don’t get a vote. Let’s all keep our fingers crossed.

COPYRIGHT Autosavant.net – All Rights Reserved

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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7 Comments

  1. I had no idea Ford still made a car anywhere in the world with the Falcon name anymore. My dad owned a Falcon from the 1960s. This is a brilliant-looking car. I would love to see it here in Europe. It looks like a nice bit of kit, and it must be very quick with a V8.

  2. As someone who loves Fords, I’d love to see these prowling the streets here in America. I’ve heard very good things about the Australian Ford Falcon over the years, and I would be very interested in having the opportinity to buy one here.

  3. The Falcon is a boganmobile.

  4. I have seen the images of the next generation Falcon, and it looks to be a winner. Seems as if Ford North America could do well with such a car, not sure why they wouldn’t bring it in.

  5. The Australian Falcon would be an excellent replacement for Fords aging Crown Vic which is getting fairly long in the tooth. I’d buy an XR8 if it were offered here in the states with a manual transmission.

  6. We don’t want the Falcodore cars here in Australia anymore. We’re happy to send them to the Yanks, who still don’t know any better. Take all of them, good riddance to bad rubbish.

  7. Having actually driven the Falcon XR8 in Australia, I can tell you that it certainly has sales potential here in America. The fans of the car in Australia are incredibly loyal to the car, and of course there are some haters of the car with equally strong feelings.

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